The Michigan Marijuana Regulatory Agency (MRA) has issued its January 2022 report detailing sales, licensing, and production data in the state’s adult use and medical cannabis markets. Michigan’s January 2022 combined adult use and medical cannabis sales, at $153 million, fell 9.2% month-on-month from $168 million in December 2021. Year-on-year, January 2022 sales are up nearly 41% from $108.5 million in January 2021.
January 2022 Adult Use Market Summary
Adult use sales have fallen in two of the past three months, likely due in part to cratering Michigan cannabis prices and exacerbated in the past month by post-holiday demand slippage. Michigan has no state-level license cap, saw the first significant outdoor crop hit the market beginning in Q4 last year, and has seen aggressive price-cutting by newly licensed growers, all of which are weighing on price and monthly sales figures.
Average daily sales fell to $4 million in January from $4.4 million in December 2021 but are up 46% year-on-year from $2.2 million in January 2021.
Retail flower sales volume jumped 15.6% in January 2022, after rising 15% in December 2021, even as sales revenue fell by 5.5%, emphasizing the effects of crashing wholesale spot market prices even as demand increases. Cannabis Benchmarks has learned new growers, some outdoor, are undercutting price to attract buyers and establish their brands in what is becoming a very competitive market.
Inventory of flower held by growers that has passed the state’s required testing was at 46,065 pounds at the end of January. Combined with the amount of flower held in inventory at retailers, 43,306 pounds, the amount of immediately marketable flower in Michigan’s adult use market as of the end of January was 89,371 pounds, or the equivalent of 3.6 months of supply based on January flower sales of 24,884 pounds.
The number of plants reared and harvested in the most recent three months is shown in the table below. Vegetative and flowering plant figures are as of month-end, while the harvested plant figures encompass all those successfully harvested throughout the month of December.
Vegetative plant count fell 4.3% month-on-month in January and flowering plant count rose by 7.4%. Harvested plant count rose by 1.5% in January.
The average retail flower price fell for the fourth month in a row, shedding over $32 per ounce from December to January. The extrapolated retail price per pound is now what the wholesale spot flower price was in November 2021. Year-on-year the average price of an ounce of retail flower is down nearly 53%.
- November 2021: $190.71 ($3,051 per pound)
- December 2021: $184.90 ($2,958 per pound)
- January 2022: $152.74 ($2,444 per pound)
January 2022 Medical Cannabis Market Summary
January sales in the medical cannabis market returned to trend, falling 15% after a 3.2% gain in December, making for the fourth month of lower sales in the past five months. Average daily sales fell 15.2% to $900,921 in January from $1,062,211 in December 2021. Medical sales as a percent of total Michigan cannabis sales were 18.3% in January, down 0.9% from December 2021, and down over 50% from January 2021’s 37.9% market share.
Retail sales of flower in the medical market and month-on-month changes for the past three months are depicted in the table below.
Retail flower sales in the medical market have also returned to trend, falling for the fourth time in five months and at a pace not previously observed. Significantly lower prices and shrinking medical demand from patients moving to the adult use market are weighing on medical sales and supply.
Inventory of flower at medical cannabis growers that passed the state’s required testing stood at 22,001 pounds at the end of January. Combined with flower held in inventory at dispensaries – 28,918 pounds – the amount of immediately marketable flower in the medical cannabis market stood at 51,819 pounds, or 7.7 months’ worth of supply based on January medical market demand.
The number of plants reared and harvested in the medical sector in the most recent three months is shown in the table below. Vegetative and flowering plant figures are as of month-end, while harvested plant figures encompass all those successfully harvested throughout January 2022.
Vegetative plant count fell 1.6% in January and flowering plant count saw little changed as well, rising just 0.3%. The medical sector appears to be maintaining the status quo regarding production capacity in the face of sharply falling prices and a diminishing share of the state’s overall cannabis market.
MRA data shows retail flower prices in the state’s medical cannabis market have cratered, falling 31.8% month-on-month, or $56 per ounce, to below $120 per ounce.
Trailing three month retail ounce and extrapolated pound prices are listed below.
- November 2021: $173.77 ($2,780 per pound)
- December 2021: $175.57 ($2,809 per pound)
- January 2022: $119.64 ($1,914 per pound)